Gordon Biggest Waster Since 1983
It appears that when Gordon vacates number 11 later this year, he will leave behind a legacy of tax-and-spend that sees the Government’s spending as the largest share of national income for nearly a quarter of a century. But it’s all alright for him, as when the house of cards collapses he can simply blame it on whichever sucker steps up to take his place. It seems as though Brown is planning to use Jack Straw, one of the biggest suckers around, as his sacrificial lamb. This Sunday’s Telgraph says:
Gordon Brown’s 10th - and final - budget is on March 21. In the run-up to his swansong, it is increasingly clear that the Chancellor has driven Britain onto the fiscal rocks.
New official figures suggest that this will be the seventh successive budget in which Brown is forced to revise his borrowing figures upwards.
Between April 2006 and January 2007, the central government current budget deficit - tax revenues minus day-to-day spending - was £11.6bn. That’s almost £1bn more than the comparable figure last year, despite Brown’s insistence that the deficit would shrink.
These numbers add to a growing sense that the Chancellor has spent too much taxpayers’ money, without securing a compensating improvement in public services.
Richard Jeffrey, the economist, calculates that government spending under Brown has risen by 98 per cent in cash terms, while the economy overall has grown by 69 per cent. That’s why government spending last year claimed its biggest share of national income since 1983.
The International Monetary Fund, the world’s most important financial watchdog, is now raising concerns about Brown’s “credibility”.
In its latest report on the British economy, published last week, the IMF said the Chancellor faced a “critical test” and called on him to rein in public spending after years of largesse.
Brown’s actions have led to “a sharp deterioration in the fiscal balance and rising net public debt”, said the IMF, while predicting that government borrowing would spiral beyond the Treasury’s forecasts.
And next week business leaders too will indicate how worried they are that this high-spending chancellor is undermining Britain’s ability to compete.
“We are at a fork in the road,” says Miles Templeman, the director-general of the Institute of Directors, in the IoD’s forthcoming Budget submission.
“There is nothing inevitable about a rising burden of taxation - since 1993 public spending in Spain has fallen by almost 11 per cent,” he says. “Perhaps the UK needs some Spanish lessons, as the current size of our state is not globally competitive.”
The IoD document highlights how “fiscally exposed” we are in the event of a sharp downturn. “There is no buffer in the public finances to absorb the impact of such an event,” says Templeman.
That’s true - even Brown’s repeatedly rigged “golden rule” shows a surplus of just 0.1 per cent of national income.
The Chancellor knows the fiscal crunch is coming. That is why he has deferred the tough decisions until the second Comprehensive Spending Review (which has itself been postponed from the summer to the autumn).
By then, of course, he will be ensconced in No 10. Brown can then blame the fallout on his successor as chancellor - his new friend, Jack Straw.
When the IMF starts sending out the warning signals, you know things are getting serious.
